What are the upsides and downsides of being an Employee-Owned company?
In: Economics
It depends on what you mean by “employee-owned”. There are some companies where the ownership is literally a small cluster of employees, like you might read on some r/antiwork articles, and this isn’t very common in the US. In that case, u/lollersauce914’s answer is pretty right, you are a part owner and things could go very poorly for you.
But generally, “ESOP” (employee stock ownership program) are more common, these operate pretty much like a ‘normal’ corporate company, but employees can buy stock shares and non-employees typically can’t.
In this example you *don’t have to buy stock,* in which case there really is no difference for you. If you do buy and/or get compensated in stock the big difference is the stock is harder to trade/sell than on a public company and it’s vary both less variable and less certain.
Public stock prices vary per the market by the millisecond, ESOP stock is fixed by the company (typically under the advice of a third party), and holds usually from a quarter to a whole year. so the price is much more stable BUT the company could always turn around tomorrow and be like, “we were wrong, it’s not worth $550 a share, it’s work *$5.50* a share, sorry”. So if you are saving for retirement and you’re dumping everything into your company ESOP you could be royally screwed in that case ([Enron](https://en.wikipedia.org/wiki/Enron))
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